The latest Forbes ranking of the “Best Countries for Business” has put Mongolia up 10 places (from 69 last year to 59) among more than 120 nations. At 44th, Mongolia is also reasonably high, given the competition, in the “freedom of trade” category.  Countries that come after Mongolia include India, Kazakhstan, Ukraine, China and Russia, in that order.

The editors analyze the business climates in all the national economies, focusing on degrees of personal freedoms, such as the right to participate in free and fair elections, or freedom of expression and organization. As Forbes explains, “We examine the misuse of corporate assets for personal gain. Together with economic policies supportive of free trade and low inflation, these key points form a snapshot of countries' suitability for capital investment.” Countries that have done well in this year’s list are all marked by success in limiting bureaucracy standing in the way of entrepreneurs hoping to do business within their borders.

V.Putin, Russia’s President-turned-Prime Minister, has issued an order to transfer the 49 percent stake held by the Russian Government-owned Mongolrostevetment in the Mongolian-Russian joint venture Erdenet Mining Corporation to a private company, Rostechnology. It is entirely an internal affair of Russia how assets are transferred there. Mongolia can also have nothing to say if Sergey Chemezov, who owns Rostechnology, happens to be a close friend of Putin. However, Mongolia can certainly protest if legal obligations are not observed.

The Russian side has so far received some USD 100 million in dividends from Erdenet. A partnership without mutual trust may run into problems. By presenting Mongolia with a fait accompli, Rostechnology has raised doubts about the future of a partnership that is economically vital to Mongolia.

The Open Society Forum has released statistics revealing that 43.8 million hectares, or 28 percent of Mongolian land, has been set aside for mining and exploration. The number of mining and exploration licenses stood at 4,717 in June 2008, compared to 4,361 in November 2007. In June alone, 73 new licenses were issued for mining, and 66 for exploration.

Of the total licenses, 22 percent are for mining and the rest for exploration. The three provinces with the highest concentration of licenses are Dornogobi, Selenge, and Omnogobi. Gobi-Altai has the highest ratio (1:16) of mining to exploration licenses.

Most of the mining licenses are in Tov province, followed by Selenge and, then, the Ulaanbaatar territory. In Ulaanbaatar 462, or 44 percent of the 1,060 mining licenses are for gold. Most of the others are for coal, fluorspar and iron.

The largest area under license is controlled by the national Mineral Resources and Petroleum Authority. It has 55 licenses that cover 5.2 million hectares. Ivanhoe Mines and Gobi Coal and Energy lead other companies in the size of the area they control under exploration licenses. Both are responsible for more than 2 million hectares each, and their licensed areas together are larger than the whole of Selenge province.

Companies holding mining licenses are registered in 30 countries. Two-thirds of all licenses have been issued to Mongolian companies. Companies registered in “tax havens” own about 12 percent of all mining licenses.